Forexpros – The pound remained lower against the U.S. dollar on Monday, as investor sentiment was hit by concerns over how effective measures outlined by the European Central Bank would be to tackle the debt crisis in the euro zone.
GBP/USD hit 1.5547 during U.S. morning trade, the session low; the pair subsequently consolidated at 1.5575, shedding 0.43%.
Cable was likely to find support at 1.5529, the low of August 1 and resistance at 1.5656, Friday’s high.
The pound came under pressure amid concerns that the Bank of England will cut its forecast for growth in Wednesday’s quarterly inflation report, increasing the likelihood for further stimulus measures from the central bank.
Investors also remained wary after the ECB indicated last week that it may restart its bond buying program, to help lower Spanish and Italian borrowing costs.
ECB head Mario Draghi said any such action was conditional on euro zone governments experiencing difficulty on bond markets applying to the bloc’s bailout funds to purchase government bonds and accepting strict conditions and supervision.
Meanwhile, data on Friday showing an unexpected increase in the U.S. unemployment rate last month fuelled expectations for another round of quantitative easing from the Federal Reserve.
The U.S. Department of Labor said the economy added 163,000 jobs in July, the biggest increase since February and outstripping expectations for an increase of 100,000.
However, the U.S. unemployment rate unexpectedly ticked up to 8.3%, from 8.2% in the preceding month, keeping alive speculation over the possibility of further monetary stimulus.
The pound fell to a one-month low against the euro, with EUR/GBP up 0.54% to 0.7961.
Earlier Monday, a report by mortgage lender Halifax showed that U.K. house prices fell by 0.6% in July, slightly more than expectations for a 0.5% decline, indicating that the pattern of broadly stable house prices is remaining unchanged.
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